Central Bank, Public Works Ministry Sign Agreement on Cashless Toll Road Payments

Bank Indonesia Governor Agus Martowardojo, left, and Public Works and Housing Minister Basuki Hadimuljono pose for a photo during a signing ceremony in Jakarta on Wednesday (31/05). (Antara Photo/Akbar Nugroho Gumay)

By : Tabita Diela | on 7:21 PM May 31, 2017
Category : Business, Banking/Finance

Jakarta. Bank Indonesia and the Ministry of Public Works and Housing signed an agreement on Wednesday (31/05) to implement automated payments at all tollgates in Indonesia inĀ 2018.

The central bank and the ministry agreed to first digitize payments at toll roads by October this year to ease traffic flows before implementing the multilane free-flow automated payment system next year.

The system will eliminate barriers and tool booths, allowing motorists to make cashless payments automatically while passing through certain points.

"By October 2017, all 22 toll road operators of the 35 toll roads will implement the cashless payment system," Bank Indonesia Governor Agus Martowardojo said, as quoted by Antaranews.com.

Cashless payments have been implemented on only a quarter of Indonesia's 35 toll roads so far, while only five of the country's 115 commercial banks support this payment method.

In a separate statement, Bank Indonesia said it will establish a consortium with the government for electronic toll collection in October. The consortium will be responsible for setting up a business model and maintaining the technical aspects of digital payments on toll roads.

The consortium will disrupt banks' existing business models involvingĀ bilateral agreements between the banks and toll road operators, to a centralized system. Banks that want to provide payment services on toll roads will only need to connect with the consortium instead of making a separate agreement with each toll road operator.

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